System and method for managing trading orders with decaying reserves

ABSTRACT

A system comprises a memory operable to store a trading order for a particular quantity of a trading product, wherein a first portion of the particular quantity is a displayed quantity and a second portion of the particular quantity is a reserved quantity. The system further comprises a processor communicatively coupled to the memory and operable to disclose the displayed quantity to one or more market centers. The processor is further operable to identify a decay rate associated with the trading order. The processor is further operable to cause the reserved quantity to decay based at least in part on the identified decay rate.

TECHNICAL FIELD OF THE INVENTION

The present invention relates generally to electronic trading and morespecifically to a system and method for managing trading orders withdecaying reserves.

BACKGROUND OF THE INVENTION

In recent years, electronic trading systems have gained wide spreadacceptance for trading of a wide variety of items, such as goods,services, financial instruments, and commodities. For example,electronic trading systems have been created which facilitate thetrading of financial instruments and commodities such as stocks, bonds,currency, futures contracts, oil, and gold.

Many of these electronic trading systems use a bid/offer process inwhich bids and offers are submitted to the systems by a passive side andthen those bids and offers are hit or lifted (or taken) by an aggressiveside. For example, a passive trading counterparty may submit a “bid” tobuy a particular trading product. In response to such a bid, anaggressive side counterparty may submit a “hit” in order to indicate awillingness to sell the trading product to the first counterparty at thegiven price. Alternatively, a passive side counterparty may submit an“offer” to sell the particular trading product at the given price, andthen the aggressive side counterparty may submit a “lift” (or “take”) inresponse to the offer to indicate a willingness to buy the tradingproduct from the passive side counterparty at the given price.

SUMMARY OF THE INVENTION

In accordance with the present invention, the disadvantages and problemsassociated with prior electronic trading systems have been substantiallyreduced or eliminated.

In some embodiments, a system comprises a memory operable to store atrading order for a particular quantity of a trading product, wherein afirst portion of the particular quantity is a displayed quantity and asecond portion of the particular quantity is a reserved quantity. Thesystem further comprises a processor communicatively coupled to thememory and operable to disclose the displayed quantity to one or moremarket centers. The processor is further operable to identify a decayrate associated with the trading order. The processor is furtheroperable to cause the reserved quantity to decay based at least in parton the identified decay rate.

Various embodiments of the present disclosure may benefit from numerousadvantages. It should be noted that one or more embodiments may benefitfrom some, none, or all of the advantages discussed below.

One advantage is that a trading system may allow a trader to submit atrading order comprising a displayed quantity and a reserved quantity.The trading system may disclose the displayed quantity to multiplemarket centers while preventing the disclosure of the reserved quantity.In some embodiment, the trading system causes the reserved quantity ofthe trading order to decay over time. The trading system may therebyreduce certain risks associated with market volatility. In particular,by causing the reserved quantity to decay, the trading system may reducethe trader's risk of having exposure for a stale trading order with aprice that is no longer favorable for the trader.

Another advantage is that, by causing the reserved quantity of tradingorder to decay, the trading system may improve system efficiency. Inparticular, as trading orders with reserved quantities are notaggressed, trading system may gradually delete the reserved quantitiesof such trading orders from one or more order books. Deleting portionsof such trading orders may free up memory and processing resources inthe trading system. Trading system may thereby improve data throughputand/or conserve system resources.

Other advantages will be readily apparent to one having ordinary skillin the art from the following figures, descriptions, and claims.

BRIEF DESCRIPTION OF THE DRAWINGS

For a more complete understanding of the present invention and itsadvantages, reference is now made to the following description, taken inconjunction with the accompanying drawings, in which:

FIG. 1 illustrates one embodiment of a trading system in accordance withthe present invention;

FIG. 2 illustrates decay of a trading order with a reserved quantity,according to certain embodiments;

FIG. 3 illustrates decay of a trading order with a reserved quantity,according to certain embodiments; and

FIG. 4 illustrates a flowchart for managing a trading order with areserved quantity, according to certain embodiments.

DETAILED DESCRIPTION OF THE INVENTION

FIG. 1 illustrates one embodiment of a trading system 10. Generally,trading system 10 comprises a trading platform 50 communicativelycoupled to clients 20, networks 30, and market centers 40. Tradingplatform 50 may receive and process trading orders 12 from traders 70.In some embodiments, trading platform 50 may cause a portion of tradingorder 12 to decay over time. Trading platform 50 may thereby reducecertain risks associated with market volatility. In particular, bycausing a portion of trading order 12 to decay, trading platform 50 mayreduce the risks of having exposure to a stale trading order 12 with aprice that has become unfavorable.

A given trading order 12 may comprise two parts—a “displayed quantity”and a “reserved quantity.” In placing trading order 12, trader 70 mayindicate that only a portion of the total quantity of trading order 12should be displayed to other traders 70. This portion of trading order12 to be displayed to other traders 70 is referred to as the “displayedquantity.” The remaining portion of trading order 12 is referred to asthe “reserved quantity.” Designating a portion of trading order 12 as a“reserved quantity” allows trader 70 to enter a large trading order 12while only displaying a portion of that trading order 12 to othertraders 70. Trading platform 50 may incrementally fill a particulartrading order 12 by first filling the displayed quantity of that tradingorder 12 and then using the reserved quantity to replenish the displayedquantity of that trading order 12.

Trading orders 12 generally comprise orders 12 a and counterorders 12 b.Orders 12 a and counterorders 12 b may be buy orders 14 and sell orders16. Orders 12 a and counterorders 12 b are complementary actions suchas, for example, buying and selling. If an order 12 a refers to a buyorder 14, then a counterorder 12 b refers to a sell order 16.Conversely, if an order 12 a refers to a sell order 16, then acounterorder 12 b refers to a buy order 14. A buy order 14 is a requestto buy a particular quantity of a particular trading product (e.g., bidrequest). A sell order 16 is a request to sell a particular quantity ofa particular trading product (e.g., offer request). In particularembodiments, trading order 12 may specify a target price (e.g., targetbid price or target offer price) for the trading product. Althoughsystem 10 is exemplified below using equities as the trading product,the trading product that forms the basis of trading order 12 maycomprise any goods, services, financial instruments, commodities, etc.Examples of financial instruments include, but are not limited to,stocks, bonds, and futures contracts.

Clients 20 are operable to receive trading orders 12 from traders 70 andto send trading orders 12 to trading platform 50 and/or market centers40. Clients 20 comprise any suitable local or remote end-user devicesthat may be used by traders 70 to access one or more elements of tradingsystem 10, such as trading platform 50. A particular client 20 maycomprise a computer, workstation, telephone, Internet browser,electronic notebook, Personal Digital Assistant (PDA), pager, or anyother suitable device (wireless or otherwise), component, or elementcapable of receiving, processing, storing, and/or communicatinginformation with other components of system 10. Client 20 may alsocomprise any suitable user interface such as a display, microphone,keypad, keyboard, touch screen, or any other appropriate terminalequipment according to particular configurations and arrangements. Itwill be understood that there may be any number of clients 20communicatively connected to trading platform 50. In addition, there maybe any number of clients 20 communicatively connected to market centers40 without using trading platform 50.

Although clients 20 are described herein as being used by “traders” 70,it should be understood that the term “trader” is meant to broadly applyto any user of trading system 10, whether that user is an agent actingon behalf of a principal, a principal, an individual, a legal entity(such as a corporation), or any machine or mechanism that is capable ofplacing and/or responding to trading orders 12 in system 10.

According to certain embodiments, traders 70 may include market makers.A market maker may include any individual or firm that submits and/ormaintains either or both bid and offer trading orders 12 simultaneouslyfor the same instrument. For example, a market maker may include anindividual or firm, such as a brokerage or bank, that maintains either afirm bid and/or offer price in a given security by standing ready,willing, and able to buy and/or sell that security at publicly quotedprices. A market maker generally displays bid and/or offer prices forspecific numbers of specific securities, and if these prices are met,the market maker will immediately buy for and/or sell from its ownaccounts. According to certain embodiments, a single trading order 12may be filled by a number of market makers at potentially differentprices.

Networks 30 are communication platforms operable to exchange data orinformation between clients 20 and trading platform 50 and/or marketcenters 40. According to certain embodiments, a particular network 30may represent an Internet architecture which provides clients 20 withthe ability to communicate trading or transaction information to tradingplatform 50 and/or market centers 40. According to certain embodiments,network 30 comprises a plain old telephone system (POTS), which traders70 may use to perform the same operations and functions. Transactionsmay be assisted by a broker associated with trading platform 50 ormanually keyed into a telephone or other suitable electronic device torequest that a transaction be executed. In certain embodiments, network30 may be any packet data network (PDN) offering a communicationsinterface or exchange between any two nodes in system 10. Network 30 maycomprise any combination of local area network (LAN), metropolitan areanetwork (MAN), wide area network (WAN), wireless local area network(WLAN), virtual private network (VPN), intranet, or any otherappropriate architecture or system that facilitates communicationsbetween clients 20 and trading platform 50 and/or market centers 40.

Market centers 40 comprise all manner of order execution venuesincluding exchanges, Electronic Communication Networks (ECNs),Alternative Trading Systems (ATSs), market makers, or any other suitablemarket participants. Each market center 40 maintains a bid and offerprice for a given trading product by standing ready, willing, and ableto buy or sell that trading product at publicly quoted prices, alsoreferred to as market center prices. Different market centers 40 mayprovide different market center prices for particular trading products.For example, a particular market center 40 may offer a particular bidprice and/or offer price for a particular trading product, while anothermarket center 40 may offer a different bid price and/or offer price forthe same trading product. A particular market center 40 may charge atransaction cost to execute trading orders 12 that remain in the orderbooks of that market center 40 for more than a certain length of time.Different market centers 40 may have different policies regarding thedisclosure of various details of trading orders 12. For example, certainmarket centers 40 referred to as “cooperative” market centers maydisclose both the displayed quantities and the reserved quantities oftrading orders 12 to trading platform 50. Other market centers 40referred to as “non-cooperative” market centers may disclose only thedisplayed quantities of trading orders 12 to trading platform 50.

Trading platform 50 is a trading architecture that facilitates therouting, matching, and otherwise processing of trading orders 12.Trading platform 50 may comprise a management center or a headquarteringoffice for any person, business, or entity that seeks to route,allocate, match, process, or fill trading orders 12. Accordingly,trading platform 50 may include any suitable combination of hardware,software, personnel, devices, components, elements, or objects that maybe utilized or implemented to achieve the operations and functions of anadministrative body or a supervising entity that manages or administersa trading environment. In certain embodiments, trading platform 50comprises client interface 52, market interface 54, processor 56, andmemory module 60.

Client interface 52 of trading platform 50 is communicatively coupled tonetwork 30 and supports communications between clients 20 and thevarious components of trading platform 50. According to certainembodiments, client interface 52 comprises a transaction server thatreceives trading orders 12 communicated by clients 20 via network 30.

Market interface 54 is communicatively coupled to market centers 40 andsupports communications between market centers 40 and the variouscomponents of trading platform 50. Market interface 54 may comprise atransaction server that receives trading orders 12 communicated bymarket centers 40. Market interface 54 may be operable to send to marketcenters 40 trading orders 12 received from clients 20 connected directlyto trading platform 50.

Client interface 52 and market interface 54 are communicatively coupledto processor 56. Processor 56 is operable to record trading orders 12 inmemory module 60 and route trading orders 12 to market centers 40.Processor 56 is further operable to execute logic 62 stored in memorymodule 60 to match buy orders 14 and sell orders 16 received by clientinterface 52 and market interface 54. In addition, processor 56 isoperable to incrementally fill a particular trading order 12 by usingthe reserved quantity of that trading order 12 to replenish thedisplayed quantity of that trading order 12. In some embodiments,processor 56 may cause the reserved quantity of trading order 12 todecay over time. Processor 56 may comprise any suitable combination ofhardware and software implemented in one or more modules to provide thedescribed function or operation.

Memory module 60 comprises any suitable arrangement of random accessmemory (RAM), read only memory (ROM), magnetic computer disk, CD-ROM, orother magnetic or optical storage media, or any other volatile ornon-volatile memory devices that store one or more files, lists, tables,or other arrangements of information such as trading orders 12. AlthoughFIG. 1 illustrates memory module 60 as internal to trading platform 50,it should be understood that memory module 60 may be internal orexternal to components of trading system 10, depending on particularimplementations. Also, memory module 60 illustrated in FIG. 1 may beseparate or integral to other memory devices to achieve any suitablearrangement of memory devices for use in trading system 10.

According to certain embodiments, memory module 60 stores logic 62 andtrader profiles 64. Logic 62 generally comprises software instructionsfor routing, matching, processing, or filling trading orders 12.Processor 56 is operable to execute logic 62 in memory module 60 tomatch buy orders 14 and sell orders 16 and to determine the priority oftraders 70 associated with those buy orders 14 and sell orders 16.

Memory module 60 may store a respective trader profile 64 for eachtrader 70 in trading system 10. Trader profile 64 for a particulartrader 70 may comprise the name, account information, tradingpreferences, trade history, and/or other suitable information associatedwith the particular trader 70. In some embodiments, trader profile 64comprises one or more decay rules 66. Processor 56 may execute decayrule 66 to determine the rate and/or frequency at which to reduce thereserved quantity of trading order 12. Decay rule 66 may specify anamount by which the reserved quantity of trading order 12 should decayover time. For example, decay rule 66 may direct processor to reduce thereserved quantity of trading order 12 by one thousand units per minute.By reducing the reserved quantity of trading order 12 over time,processor may reduce the risks associated with having a stale tradingorder 12 in a volatile market. In some embodiments, a particular decayrule 66 may be associated with a decay interval 68 and a decay rate 72(described below with respect to FIG. 2).

It should be understood that the internal structure of trading platform50 and the interfaces, processors, and memory devices associatedtherewith is malleable and can be readily changed, modified, rearranged,or reconfigured in order to achieve the intended operations of tradingplatform 50.

In operation, trading platform 50 is operable to receive trading order12 from client 20. Trading order 12 may be for a particular quantity ofa particular trading product (e.g., equities, commodities, futures,currencies, bonds, and so forth). In some embodiments, trading order 12designates a portion of the particular quantity as a displayed quantity.Trading order 12 may designate another portion of the particularquantity of trading order 12 as the reserved quantity. Trading platform50 may disclose the displayed quantity of trading order 12 to marketcenter 40. In some embodiments, trading platform 50 prevents thedisclosure of the reserved quantity of trading order 12 to market center40.

Upon receiving trading order 12, processor 56 may identify decay rule 66stored in memory module 60. Decay rule 66 may instruct processor 56 toreduce the reserved quantity of trading order 12 over time. Reducing thereserved quantity of trading order 12 may comprise deleting a portion oftrading order 12 from one or more order books 74 in memory module 60. Insome embodiments, the reduction of the reserved quantity of tradingorder 12 is based at least in part on decay rate 72 associated withdecay rule 66.

FIG. 2 is a table 200 that sets forth an example illustrating the decayof trading order 12, according to certain embodiments. In this example,memory module 60 stores one or more decay rules 66 that cause thereserved quantity of trading order 12 to decay over time. As eachsuccessive interval of time expires, processor 56 may reduce thereserved quantity of trading order 12 by a configurable increment. Thetime intervals at which the reserved quantity decays may be referred toas decay intervals 68. The rate at which the reserved quantity decaysmay be referred to as decay rate 72. For example, decay rule 66 mayspecify that, at the expiration of each successive minute after tradingplatform 50 receives trading order 12, processor 56 reduces reservedquantity of trading order 12 by five million units. In this example,decay interval 68 is one minute and decay rate 72 is five millionunits/minute. Although the foregoing example illustrates decay interval68 of one minute, it should be understood that decay interval 68 may beten seconds, two minutes, ten minutes, and/or any suitable interval oftime. Although the foregoing example illustrates decay rate 72 of fivemillion units/minute, it should be understood that decay rate 72 may beone hundred units/second, one million units/minute, and/or any suitablerate.

In some embodiments, once processor 56 uses counterorder 12 b to fillthe displayed quantity of order 12 a, processor 56 may replenish thedisplayed quantity of order 12 a. In particular, processor 56 may beconfigured to use a portion of the reserved quantity of order 12 a toreplenish the displayed quantity of order 12 a. In some embodiments, thefilling and replenishing of the displayed quantity of order 12 a occursindependently of the decay of the reserved quantity of order 12 a.

The example order 12 a in table 200 illustrates certain embodiments. Inthis example, trading platform 50 comprises decay rule 66 to reduce thereserved quantity of trading order 12 by twenty million units perminute. In this example, at 10:26:02 a.m., trading platform 50 receivesBid A from Trader A. Bid A is for one hundred million units of SecurityX at a price of two dollars per unit. The trading product and priceassociated with Bid A is illustrated in columns 202 and 204,respectively. Bid A has a displayed quantity of ten million units and areserved quantity of ninety million units. The displayed quantity andreserved quantity of Bid A is illustrated in columns 206 and 208,respectively.

Upon receiving Bid A, processor 56 discloses the displayed quantity(i.e., ten million units) of Bid A to market centers 40. At 10:26:34a.m., trading platform 50 receives Offer B, a matching counterorder 12b. Offer B is for ten million units of Security X at two dollars perunit. Upon receiving Offer B, processor 56 uses the ten million unitsfrom Offer B to fill the displayed quantity of Bid A. Processor 56 thenuses ten million units from the reserved quantity of Bid A to replenishthe displayed quantity of Bid A. Thus, the reserved quantity of Bid Abecomes eighty million units.

In this example, trading platform 50 does not receive any other matchingcounterorders 12 b prior to 10:27:02 a.m.—one minute after tradingplatform 50 received Bid A. According to decay rule 66, at 10:27:02a.m., processor 56 reduces reserved quantity of Bid A from eightymillion units to sixty million units. With the expiration of eachsuccessive minute, processor 56 continues to reduce reserved quantity ofBid A according to decay rule 66. By decaying the reserved quantity ofBid A over time, processor 56 may reduce certain risks associated withmarket volatility. In particular, by reducing the reserved quantity ofBid A over time, processor 56 may reduce the risk of Trader A havingexposure for a stale trading order 12 with a price that is no longerfavorable for Trader A.

In some embodiments, trading platform 50 may comprise different decayrules 66 for different traders 70. In particular, memory module 60 maystore a respective trader profile 64 for each trader 70 in tradingsystem 10. Trader profile 64 for a particular trader 70 may comprise oneor more decay rules 66 that are configurable by that trader 70. In someembodiments, a particular trader profile 64 may comprise a first decayrule 66 for a first trading product, a second decay rule 66 for a secondtrading product, and so forth. Thus, a particular trader 70 may causethe reserved quantity of trading order 12 for a first trading product todecay at a different rate than the reserved quantity of trading order 12for a second trading product. In some embodiments, upon receivingtrading order 12, processor 56 identifies the particular trader 70 thatsubmitted trading order 12. Processor 56 may then identify in memorymodule 60 trader profile 64 associated with the particular trader 70.Processor 56 may then retrieve the appropriate decay rule 66 from theidentified trader profile 64. Thus, processor 56 may apply differentdecay rules 66 for different traders 70.

In some embodiments, decay rule 66 may specify an initial decay interval68 that is longer or shorter than successive decay intervals 68. Forexample, a particular decay rule 66 may specify that, five minutes aftertrading platform 50 received trading order 12, processor 56 beginsdecaying the reserved quantity of trading order 12. After the initialfive minute interval, the particular decay rule 66 may specify thatprocessor 56 continue to decay the reserved quantity after eachsuccessive minute.

Decay rule 66 may comprise any suitable formula, table, algorithm,and/or instructions for reducing the reserved quantity of trading order12. In some embodiments, decay rule 66 may comprise a formula for avariable decay rate 72.

FIG. 3 is a table 300 that sets forth an example illustrating variablerate decay of trading order 12, according to certain embodiments. Inthis example, decay rule 66 instructs processor 56 to decay the reservedquantity of trading order 12 at a rate of “10T” where “T” is the numberof minutes since trading platform 50 received trading order 12. At11:42:12 a.m., trading platform 50 receives Bid A for one hundred unitsof Security Y. Bid A comprises a displayed quantity of ten units and areserved quantity of ninety units. The trading product, displayedquantity, and reserved quantity associated with Bid A are illustrated incolumns 302, 304, and 306, respectively.

In this example, processor 56 reduces the reserved quantity of Bid Aaccording to decay rule 66. In particular, at 11:43:12 a.m., processor56 reduces the reserved quantity of Bid A by ten units (i.e., 10×1). At11:44:12 a.m., processor 56 further reduces the reserved quantity of BidA by twenty units (i.e., 10×2). With each successive minute, processor56 reduces the reserved quantity of Bid A by an increasing amountaccording to decay rule 66. The decay of the reserved quantity maycontinue until the reserved quantity is eliminated. Thus, decay rule 66may specify a variable decay rate 72.

Although the foregoing example illustrates decay rate 72 associated witha particular formula, it should be understood that decay rule 66 maycomprise any suitable formula, table, algorithm, and/or instructions forreducing the reserved quantity of trading order 12 over time.

FIG. 4 illustrates a flowchart for managing trading orders 12, accordingto certain embodiments. The method begins at step 402 where tradingplatform 50 receives order 12 a from client 20. Order 12 a may be for aparticular quantity of a trading product. A portion of the particularquantity of order 12 a may be designated as a displayed quantity. Theremaining portion of the particular quantity of order 12 a may bedesignated as the reserved quantity. At step 404, trading platform 50discloses the displayed quantity of order 12 a to market centers 40.Disclosing the displayed quantity of order 12 a may comprisetransmitting data regarding the displayed quantity of order 12 a tomarket centers 40.

At step 406, processor 56 determines whether trading platform 50 hasreceived counterorder 12 b that matches order 12 a. In some embodiments,the determination of whether counterorder 12 b matches order 12 a isbased at least in part on whether counterorder 12 b and order 12 a arefor the same product, the same price, and/or or crossing prices. Ifprocessor 56 determines at step 406 that trading platform 50 has notreceived counterorder 12 b that matches order 12 a, then the methodproceeds to step 414. However, if processor 56 determines at step 406that trading platform 50 has received counterorder 12 b that matchesorder 12 a, then at step 408 processor 56 uses the counterorder 12 b tofill the displayed quantity of order 12 a. At step 410, processor 56determines whether the reserved quantity of order 12 a is greater thanzero. If processor 56 determines at step 410 that the reserved quantityof order 12 a is not greater than zero, then the method ends. However,if processor 56 determines at step 410 that the reserved quantity oforder 12 a is greater than zero, then at step 412 processor 56 uses aportion of the reserved quantity of order 12 a to replenish thedisplayed quantity of order 12 a. The method then proceeds to step 414.

At step 414, processor 56 determines whether decay interval 68associated with decay rule 66 has expired. If processor 56 determines atstep 414 that decay interval 68 has not expired, then the method returnsto step 406. However, if processor 56 determines at step 414 that decayinterval 68 has expired, then at step 416 processor 56 determineswhether the reserved quantity of order 12 a is greater than zero. Ifprocessor 56 determines at step 416 that the reserved quantity is notgreater than zero, then the method returns to step 406. However, ifprocessor 56 determines at step 416 that the reserved quantity isgreater than zero, then at step 418 processor 56 reduces the reservedquantity of order 12 a by a configurable amount according to decay rule66. Decay rule 66 may comprise any suitable formula, table, algorithm,and/or instructions for reducing the reserved quantity of order 12 aover time. Decay rule 66 may specify any suitable length of decayinterval 68 and/or may specify any suitable decay rate 72. Afterprocessor 56 reduces the reserved quantity of order 12 a at step 418,the method returns to step 406. The method ends when, at step 410,processor 56 determines that the reserved quantity of order 12 a is notgreater than zero. In some embodiments, the method may also end whenorder 12 a expires and/or when trading platform 50 receives a cancelorder associated with order 12 a.

Although the present invention has been described in severalembodiments, a myriad of changes and modifications may be suggested toone skilled in the art, and it is intended that the present inventionencompass such changes and modifications as fall within the scope of thepresent appended claims.

1-20. (canceled)
 21. An apparatus, comprising: a processor; and amemory, in which the memory stores software instructions that, whenexecuted by the processor, cause the processor to: receive, from atrader, a trading order for a particular quantity of a trading product,in which a first portion of the particular quantity is a displayedquantity, and a second portion of the particular quantity is a reservedquantity; store the trading order in the memory; identify a decay rulestored in the memory, in which the decay rule is associated with atleast one of the trader and the trading product; disclose the displayedquantity of the trading order to one or more market centers; receive acounterorder for another particular quantity of the trading product;determine that the counterorder matches the trading order; fill thedisplayed quantity of the trading order with at least a portion of theanother particular quantity of the trading product of the counterorder;determine that the reserved quantity of the trading order is greaterthan zero; replenish the displayed quantity of the trading order with aportion of the reserved quantity of the trading order, in which aremaining portion of the reserved quantity is left over afterreplenishing the displayed quantity; determine that the remainingportion of the reserved quantity of the trading order is greater thanzero; and reduce the remaining portion of the reserved quantity inaccordance with the decay rule.
 22. The apparatus of claim 21, in whichthe decay rule specifies a decay rate; and in which the decay rate is avariable rate such that the remaining portion of the reserved quantityis reduced at one of a decreasing rate and an increasing rate.
 23. Theapparatus of claim 21, in which the software instructions, when executedby the processor, further cause the processor to: upon receiving thetrading order from the trader, identify the trader; identify a traderprofile associated with the trader; and in which identifying the decayrule comprises: retrieving the decay rule from the trader profile, inwhich the decay rule is associated with at least the trader.
 24. Theapparatus of claim 21, in which the decay rule specifies a decay rate;in which the decay rate is a first decay rate and the trading product isa first trading product of a plurality of trading products; and in whichthe software instructions, when executed by the processor, further causethe processor to: identify a plurality of decay rates, in which eachdecay rate of the plurality of decay rates is associated with arespective trading product of the plurality of trading products.
 25. Theapparatus of claim 21, in which the software instructions, when executedby the processor, further cause the processor to: record at least thereserved quantity of the trading order in an order book; and in whichthe decay rule specifies a time interval and a decay rate; and in whichreducing the remaining portion of the reserved quantity in accordancewith the decay rule comprises: in response to an expiration of the timeinterval, deleting at least a portion of the remaining portion of thereserved quantity from the order book.
 26. The apparatus of claim 21, inwhich the decay rule specifies a time interval; and in which receivingthe trading order from the trader comprises: receiving the trading orderfrom the trader at a first time; and in which the software instructions,when executed by the processor, further cause the processor to: prior todetermining that the remaining portion of the reserved quantity of thetrading order is greater than zero, determine that the time intervalafter the first time has expired.
 27. The apparatus of claim 26, inwhich the decay rule specifies the time interval and a decay quantity;and in which reducing the remaining portion of the reserved quantity inaccordance with the decay rule comprises: in response to determiningthat the time interval has expired after the first time, subtracting thedecay quantity from the remaining portion of the reserved quantity; andfor each successive time interval until the remaining portion of thereserved quantity is zero, in response to an expiration of thesuccessive time interval, subtracting the decay quantity from theremaining portion of the reserved quantity.
 28. The apparatus of claim26, in which the decay rule specifies a decay rate and a time interval,and in which the decay rate is a variable decay rate; and in whichreducing the remaining portion of the reserved quantity in accordancewith the decay rule comprises: upon determining that the time intervalhas expired after the first time, reducing the remaining portion of thereserved quantity by a first quantity; and in which the softwareinstructions, when executed by the processor, further cause theprocessor to: increase the variable decay rate; and upon an expirationof a successive time interval after the time interval, reduce theremaining portion of the reserved quantity by a second quantity, inwhich the second quantity is larger than the first quantity.
 29. Theapparatus of claim 26, in which the decay rule specifies a decay rateand a time interval, and in which the decay rate is a variable decayrate; and in which reducing the remaining portion of the reservedquantity in accordance with the decay rule comprises: upon determiningthat the time interval has expired after the first time, reducing theremaining portion of the reserved quantity by a first quantity; and inwhich the software instructions, when executed by the processor, furthercause the processor to: decrease the variable decay rate; and upon anexpiration of a successive time interval after the time interval, reducethe remaining portion of the reserved quantity by a second quantity, inwhich the second quantity is smaller than the first quantity.
 30. Theapparatus of claim 21, in which the software instructions, when executedby the processor, further cause the processor to: receive, from a secondtrader, a second trading order for still another particular quantity ofthe trading product, in which the still another particular quantity ofthe trading product comprises a second displayed quantity and a secondreserved quantity; and identify a second decay rule, in which the seconddecay rule is associated with at least the second trader and the tradingproduct, and in which the second decay rule specifies a decay rate; andcause the second reserved quantity of the second trading order to decaybased at least in part on the decay rate.
 31. The apparatus of claim 21,in which the software instructions, when executed by the processor,further cause the processor to: receive, from a second trader, a secondtrading order for still another particular quantity of the tradingproduct, in which the still another particular quantity of the tradingproduct comprises a second displayed quantity and a second reservedquantity; and identify a second decay rule, in which the second decayrule is associated with at least the second trader and the tradingproduct, and in which the second decay rule specifies a decay quantity;and cause the second reserved quantity of the second trading order todecay based at least in part on the decay quantity.
 32. The apparatus ofclaim 21, in which the decay rule comprises at least one of a formula, atable, an algorithm, and instructions.
 33. The apparatus of claim 21, inwhich the decay rule specifies a decay rate, a time interval, and adecay quantity.
 34. The apparatus of claim 21, in which the decay rulespecifies a decay rate.
 35. The apparatus of claim 21, in which thedecay rule specifies a decay quantity.
 36. The apparatus of claim 21, inwhich the decay rule specifies a time interval.
 37. The apparatus ofclaim 36, in which the decay rule further specifies a second timeinterval.
 38. The apparatus of claim 21, in which the decay rulespecifies a decay rate but specifies no decay quantity.
 39. A method,comprising: receiving, from a trader, a trading order for a particularquantity of a trading product, in which a first portion of theparticular quantity is a displayed quantity, and a second portion of theparticular quantity is a reserved quantity; storing, by a processor of acomputer, the trading order in a memory; identifying, by the processor,a decay rule stored in the memory, in which the decay rule is associatedwith at least one of the trader and the trading product; disclosing thedisplayed quantity of the trading order to one or more market centers;receiving a counterorder for another particular quantity of the tradingproduct; determining, by the processor, that the counterorder matchesthe trading order; filling, by the processor, the displayed quantity ofthe trading order with at least a portion of the another particularquantity of the trading product of the counterorder; determining, by theprocessor, that the reserved quantity of the trading order is greaterthan zero; replenishing, by the processor, the displayed quantity of thetrading order with a portion of the reserved quantity of the tradingorder, in which a remaining portion of the reserved quantity is leftover after replenishing the displayed quantity; determining, by theprocessor, that the remaining portion of the reserved quantity of thetrading order is greater than zero; and reducing, by the processor, theremaining portion of the reserved quantity in accordance with the decayrule.
 40. The method of claim 39, in which the decay rule specifies adecay rate; in which the decay rate is a first decay rate and thetrading product is a first trading product of a plurality of tradingproducts; and in which the method further comprises: identifying, by theprocessor, a plurality of decay rates, in which each decay rate of theplurality of decay rates is associated with a respective trading productof the plurality of trading products.